1 Given the Networking Capital forecasts for Total Corp over the next 5 years, calculate the Net Present Value of the impact on the company's free cash flow projections. The Company's weighted average cost of capital is 8%. Fill in the shaded cells. Net Working Capital Projections Year just ended 10,000 Forecast Year 2 3 10,400 10,100 4 10,300 NWC 10,200 9,500 a) NPV 2 marks b) Will the Networking Capital requirements increase or decrease the Company's forecast free cashflow? 1 mark The purpose of this section is to complete an analysis on United Health Group and determine an estimate the intrinsic value of the company. Use the assumptions given to complete the analysis and then fill in all shaded cells on the answer chart below. 2 Complete the following chart: 2 marks per answer (Total of 12) 1.00% 1.50% 2.00% 4.00% 3.00% 11.16 What is United Health Group's current Market Capitalization of equity? (billions) What is the forecast FCF in 2021? (billions) What is the forecast terminal value of the FCF in 2025 using growth in perpetuity? (billions) What is the forecast Enterprise Value of the Company today? (billions) What is the forecast implied equity value today? (billions) What is the intrinsic value of the shares today? 2.50% 65.00% 19.00% Assumptions: Forecast FCF Growth Rate (annual) Year 1 2021 Year 2 2022 Year 3 2023 Year 4 2024 Year 5 2025 FCF in 2020 (billions) FCF Growth in Perpetuity COGS as a % of Revenue SG&A as a % f Revenue Tax Rate Forecast EBITDA 2025 billions) Terminal EBITDA Multiple Net Working Capital as of the end of 2020 (million NWC as a % of Revenue Capital Expenditures as a % of Revenue Cash (billions) Debt billions) Current Share price Shares Outstanding (billions) Weighted average cost of capital Rwacc 21.50% 21.20 12.40 628 1.8% 5.4% 9 11 13.00 15.00 8.00% 3 The purpose of this section is to forecast Unlevered Net Income for Zeel Corp for the current year (2021). Use the assumptions given to complete the analysis and then fill in all shaded cells on the answer chart below. Complete the following chart: 2 marks per answer (Total of 6) -3.00% 1.50% 2.00% 4.00% What is Zeel Corp's forecast sales for 2021? (billions) What is Zeel Corp's forecast Gross Profit for 2021? (billions) What is Zeel Corp's forecast Unlevered Net Income for 2021? (billions) 3.00% 20.00 2.50% 7.00% 5.00% Assumptions: Forecast Sales Growth Rate (annual) Year 1 2021 Year 2 2022 Year 3 2023 Year 4 2024 Year 5 2025 Sales in 2020 (billions) FCF Growth in Perpetuity Interest Expense as a % of Sales Marketing as a % of Sales Direct Labour as a % of Sales General administrative expenses as a % of Tax Rate Raw materials as a % of Sales Terminal EBITDA Multiple Net Working Capital as of the end of 2020 (million NWC as a % of Sales a Capital Expenditures as a % of Sales Cash (billions) Debt (billions) Current Share price Shares Outstanding (billions) Weighted average cost of capital Rwacc 10.00% 19.00% 21.50% 30.00% 11.00 360 1.8% 5.4% 25 400 271.00 10.00 9.00% 1 Given the Networking Capital forecasts for Total Corp over the next 5 years, calculate the Net Present Value of the impact on the company's free cash flow projections. The Company's weighted average cost of capital is 8%. Fill in the shaded cells. Net Working Capital Projections Year just ended 10,000 Forecast Year 2 3 10,400 10,100 4 10,300 NWC 10,200 9,500 a) NPV 2 marks b) Will the Networking Capital requirements increase or decrease the Company's forecast free cashflow? 1 mark The purpose of this section is to complete an analysis on United Health Group and determine an estimate the intrinsic value of the company. Use the assumptions given to complete the analysis and then fill in all shaded cells on the answer chart below. 2 Complete the following chart: 2 marks per answer (Total of 12) 1.00% 1.50% 2.00% 4.00% 3.00% 11.16 What is United Health Group's current Market Capitalization of equity? (billions) What is the forecast FCF in 2021? (billions) What is the forecast terminal value of the FCF in 2025 using growth in perpetuity? (billions) What is the forecast Enterprise Value of the Company today? (billions) What is the forecast implied equity value today? (billions) What is the intrinsic value of the shares today? 2.50% 65.00% 19.00% Assumptions: Forecast FCF Growth Rate (annual) Year 1 2021 Year 2 2022 Year 3 2023 Year 4 2024 Year 5 2025 FCF in 2020 (billions) FCF Growth in Perpetuity COGS as a % of Revenue SG&A as a % f Revenue Tax Rate Forecast EBITDA 2025 billions) Terminal EBITDA Multiple Net Working Capital as of the end of 2020 (million NWC as a % of Revenue Capital Expenditures as a % of Revenue Cash (billions) Debt billions) Current Share price Shares Outstanding (billions) Weighted average cost of capital Rwacc 21.50% 21.20 12.40 628 1.8% 5.4% 9 11 13.00 15.00 8.00% 3 The purpose of this section is to forecast Unlevered Net Income for Zeel Corp for the current year (2021). Use the assumptions given to complete the analysis and then fill in all shaded cells on the answer chart below. Complete the following chart: 2 marks per answer (Total of 6) -3.00% 1.50% 2.00% 4.00% What is Zeel Corp's forecast sales for 2021? (billions) What is Zeel Corp's forecast Gross Profit for 2021? (billions) What is Zeel Corp's forecast Unlevered Net Income for 2021? (billions) 3.00% 20.00 2.50% 7.00% 5.00% Assumptions: Forecast Sales Growth Rate (annual) Year 1 2021 Year 2 2022 Year 3 2023 Year 4 2024 Year 5 2025 Sales in 2020 (billions) FCF Growth in Perpetuity Interest Expense as a % of Sales Marketing as a % of Sales Direct Labour as a % of Sales General administrative expenses as a % of Tax Rate Raw materials as a % of Sales Terminal EBITDA Multiple Net Working Capital as of the end of 2020 (million NWC as a % of Sales a Capital Expenditures as a % of Sales Cash (billions) Debt (billions) Current Share price Shares Outstanding (billions) Weighted average cost of capital Rwacc 10.00% 19.00% 21.50% 30.00% 11.00 360 1.8% 5.4% 25 400 271.00 10.00 9.00%